QV Invercargill registered valuer Andrew Ronald said activity and demand in the housing market had picked up despite a downturn in the rural sector.

He said low interest rates as well as growth in home values in Central Otago and Dunedin made Southland an attractive area to buy property.

"Also [because we have seen] increased interest by out-of-town investors in the Invercargill market, it's likely the housing market here may see continued steady growth during 2016," he said.

"The market has been flat for a long period of time since the previous peak, and we are now seeing moderate value growth across Invercargill City and the wider Southland region."

Riverton had seen a particularly sharp rise in home values, Ronald said.

Values in the area were up to $257,500, he said - higher than the $239,250 median value in 2007 before the housing market collapse.

Proximity to Invercargill was a big reason for the growth, he said.

"You are also starting to see people buying homes there and commuting from there to work in the city."

Home value increases were flattest in Te Anau because of an over-supply of residential homes, Ronald said.

Real Estate Institute of New Zealand (REINZ) data shows 220 properties were sold in the Southland Region, including Invercargill, in March, at a median price of $210,000.

The median amount of time a property was on the market was 35 days.

The median sale time is down from 37 days in February, and 52 in January.

REINZ district forum leader Jon Irving said Southland's housing prices were "the most affordable in New Zealand by some margin."

The median price of all homes sold in New Zealand in March was $495,000.

He also said the rise in interest in properties in Southland was linked with the rise in housing prices in Auckland.

By the numbers: Southland housing prices3.9% - rise in housing prices in Gore in March 2016 vs. March 20154.4% - rise in housing prices in Invercargill City in March vs. March 20156.3% - rise in housing prices in the Southland District in March vs. March 2015$190,430 - average value of house in Gore District in March 2016​$216,090 - average value of house in the Southland District in March 2016$217,740 - average value of house in Invercargill City in March 2016$559,492 - average value of a house in New Zealand in March 2016